September 4, 2011

Missouri’s goal of generating 15 percent of its total energy from renewable energy by 2020 is facing some setbacks.

Voters passed Proposition C, the Clean Energy Initiative, in 2008. Yet blueprint plans of solar-powered houses and fields with wind turbines became shrouded in controversy. Renewable energy legislation has been gutted, said Carla Klein, renewable energy coordinator at Renew Missouri, an organization that works to advance renewable energy in Missouri and that helped maneuver the law through the ballot initiative process.
Proposition C passed with a two-thirds majority vote and required Missouri-based utility companies to either purchase or generate renewable energy. The law required that at least 2 percent of the sales made by utility companies must come from renewable energy resources beginning in 2011, increasing to 15 percent by 2020. At least 2 percent of that requirement had to come from solar power. In addition to these requirements, the legislation stipulated that the increased usage of renewable energy wouldn’t raise electric rates more than 1 percent over what they would have been had utilities invested in non-renewable generation as opposed to renewable generation.

“Missouri started out with a strong ballot initiative,” Klein said. “But it’s been whittled away by the legislature and resistance from utilities.”

Exemplifying the classic tug-of-war between economics and the environment, debate concerning the finer details of Proposition C carried well into 2011. The original language of the statute did not allow the source of renewable energy to come from faraway states to help fulfill the requirements imposed on utility companies. For example, to fulfill the solar energy requirement, a Missouri-based utility company could not invest in a field of solar panels in Arizona instead of Missouri, a cheaper option because buying credits from existing renewable energy is cheaper than building new.

But in an attempt to keep renewable energy investment and job creation from happening at home, the legislature modified the a new rule introduced by a legislative committee, altering it to instead allow renewable energy from faraway places to count toward the renewable energy requirement. Klein said it’s a matter of buying credits versus producing energy locally.

“It was not the voters’ intent for renewable energy to be deferred to Alaska or wherever else,” Klein said. “Utilities can buy (renewable energy credits) cheaper in other states, but Missouri citizens would only see higher rates and no benefits under this approach. There would be no job creation or impact on air quality.”

The entirely new House Bill 613 was written in response to the conflict and presented what seemed like a compromise; it cut the original mandate of 15 percent total down to 3 percent from new generation, as well as proposed that the source of renewable energy came from within state lines and erased the solar requirement, replacing it instead with $108 million in incentives for consumers to invest in solar or other forms of renewable energy.

“We spent many hours working with committee members,” Klein said.

HB 613 stalled in May. Because it was lumped with nuclear energy amendments, senators were hesitant to vote on such a large piece of legislation so close to the end of the General Assembly’s session.

“It was never brought to a vote,” Klein said. “It was brought up in debate and laid over in the last few minutes of session.”

For Renew Missouri, it’s back to the drawing board to construct a piece of legislation with “cleaner, tighter” language, Klein said. She said the rollback of renewable energy has been discouraging. Despite setbacks, however, some progress is evident.

“Before Proposition C, there were only three solar companies in Missouri,” Klein said. “Now there are 35.”

Struggles aside, Associated Electric Cooperative, Inc, a Springfield, MO-based utility that generates electricity for the rural electric cooperatives in the state, already generates six percent of their total energy from wind farms.

He said the investment-owned utilities that are required by law to advance renewable energy must make a decision. Yet that decision ultimately involves economics and won’t be easy.

“Solar energy is getting cheaper,” Rohlfing said. “It’s becoming more efficient and getting better and better. When the price comes down and the efficiency goes up, then it will be economically feasible. Today, it’s just not feasible from an economic standpoint.”

The advancement of renewable energy depends on the cost of the electric bill at a consumer’s house, Rohlfing said. The other side of the coin must be examined, he added.

“People are already struggling to pay their bills when they come into the (Boone Electric Cooperative) office,” Rohlfing said. “But we’re supplying (electricity) as inexpensively as we can. We’re relying on coal to do that. You could bring in a lot more renewable energy, but it’d be more expensive in true dollars to the customer, apart from environmental concerns.”

Rohlfing questioned the concept of saddling consumers with higher costs.

“How fair is it to burden limited-income people with a more expensive bill by forcing (electric companies) to generate renewable energy?” Rohlfing asked.

Aside from consumers, Rohlfing said potential investors have little incentive to do so despite federal tax money and rebates that are issued in hopes of lowering costs.

“I have not seen a return on investment,” Rohlfing said. “Otherwise there would be commercial investors putting up wind turbines on their own. If there were a profit to be made, people would be (investing in renewable energy). But there’s no return, and the electric bill is more expensive for the consumer.”